A Few Speculators Dominate Vast Market for Oil Trading

By David Cho
Washington Post Staff Writer
Thursday, August 21, 2008; Page A01

Regulators had long classified a private Swiss energy conglomerate called Vitol as a trader that primarily helped industrial firms that needed oil to run their businesses.

But when the Commodity Futures Trading Commission examined Vitol's books last month, it found that the firm was in fact more of a speculator, holding oil contracts as a profit-making investment rather than a means of lining up the actual delivery of fuel. Even more surprising to the commodities markets was the massive size of Vitol's portfolio -- at one point in July, the firm held 11 percent of all the oil contracts on the regulated New York Mercantile Exchange. legitimate businesses that hedge and take physical delivery of oil are being trampled by the speculators who are in the market purely to make profit.

http://www.washingtonpost.com/wp-dyn/content/article/2008/08/20/AR2008082003898.html

misty May Wrote:
-------------------------------------------------------
> A Few Speculators Dominate Vast Market for Oil
> Trading
>
> By David Cho
> Washington Post Staff Writer
> Thursday, August 21, 2008; Page A01
>
> Regulators had long classified a private Swiss
> energy conglomerate called Vitol as a trader that
> primarily helped industrial firms that needed oil
> to run their businesses.
>
> But when the Commodity Futures Trading Commission
> examined Vitol's books last month, it found that
> the firm was in fact more of a speculator, holding
> oil contracts as a profit-making investment rather
> than a means of lining up the actual delivery of
> fuel. Even more surprising to the commodities
> markets was the massive size of Vitol's portfolio
> -- at one point in July, the firm held 11 percent
> of all the oil contracts on the regulated New York
> Mercantile Exchange. legitimate businesses that
> hedge and take physical delivery of oil are being
> trampled by the speculators who are in the market
> purely to make profit.

No shit!

And here you had also the fucking idiot commentators on CNN trying to say it was supply and demand and not speculation. Bullshit! Has anyone taken Econ 101??? No way in Hell oil prices triple in 18 months without speculation or gouging going on.

I'd like to know how much money these people have thrown into republikan coffers.

Spekulators are not limited to republicans.

http://www.gurufocus.com/ListGuru.php?GuruName=George+Soros

Note that 46% of Soros investments are in Oil and Gas. I am sure there are more than enough on both sides of the aisle that profited by investing in oil lately.

Registered Voter Wrote:
-------------------------------------------------------
> Spekulators are not limited to republicans.
>
> http://www.gurufocus.com/ListGuru.php?GuruName=Geo
> rge+Soros
>
> Note that 46% of Soros investments are in Oil and
> Gas. I am sure there are more than enough on both
> sides of the aisle that profited by investing in
> oil lately.


This is why they need to reinstate Glass Steagall. Unless you have a separation between banks, brokerages, traders, etc., you are going to have firms gaming the market. Glass Steagall was de-fanged by Phil Gramm and company.

I am no stock market/spekulator expert...but does investing in stock/energy stocks equate to being a spekulator?